May 17, 2017

Trust, two ways - government and people

Quality takes time.

Trustis essential in relationships but it is absolutely essential when it comes to how we expect government to operate. People need to trust that government will act in their best interest, and do so effectively. Political differences come down how much people trust their government and consequently, how much they want the government to govern and how much they want the government to stay out of way. Conservatives do not trust government to do things more effectively than the free market, liberals on the other hand trust government more implicitly and believe that it will act in the best interest of the public more effectively than the 'invisible hand'.

Liberals complain about sinister big business and yet put trust in a government far bigger than any single business. Government is bureaucracy. All those departments trying to justify their existence have to find problems. It's a recipe for sinister, self-serving decisions. Big government even if it is not sinister, is still a recipe for inefficiency.

A defining example of government "efficiency" is Obamacare. It was more than 2000 pages put together in a matter of months by cobbling together pieces of ideas from practically everywhere. Consistency, critical re-evaluation and working together (not to mention bipartisanship) were not part of the effort. In retrospect, it's the paper tiger of legislation. It was all sizzle and no steak. It was hollow and left to it's own devices, it will collapse under it's own weight. There's no way something like that hodgepodge could go wrong, right?

For odd juxtapositional comparison, consider the best-selling album Rumours. Five (unfortunately) drug-infused musicians who were constantly at each other's throats but were nevertheless talented, spent a year putting the album together. Eleven songs, approximately 45 minutes of music that are brilliant. It took longer to produce than Obamacare and was considerably less detailed though far more eloquent.

Government does not deserve the trust it has been bestowed by the left today (president Trump aside). On the other hand, government owes the public more trust than it has offered in recent history. Dodd-Frank, FATCA, the EPA regulating farmers' dust, the IRS and its predatory investigations of Tea Party groups - it is all based on the premise that people cannot be trusted to do things for the greater good and must be forced to do so. That's fundamentally sad, and largely wrong. In Canada, with a much more left-leaning government than America, citizens donate to charity at a much lower rate than their American counterparts. That comes down to two factors: (i) higher taxes and therefore lower disposable income to provide donations and (2) less tax benefit for donating because the government would rather have the money than provide the deduction.

Give people the freedom to help others, spice it with tax incentives and you will have a lot of charity happening. Americans are more generous than Canadians not because they are fundamentally better people - people are people - but because the system encourages it to be so. And why does the system encourage it? Because their is more trust. Not enough trust, but more than elsewhere. You give that away as an American, at your peril.